The Nasdaq Composite Index
$COMPX
closed up 25.82 points, or 1.2%, at 2,141.22, posting its biggest one-day gain in nearly three months.

Volume was more than 1.62 billion shares on the New York Stock Exchange, where rising shares outnumbered losers by 22 to 9. There were more than 1.82 billion shares traded in the Nasdaq market; rising stocks outweighed falling shares by 19 to 11.

The market got a lift late in Thursday's session from portfolio additions, ahead of Friday's close of the third quarter, as investors tired of brooding over this week's record energy prices.

"I think people have gotten tired of letting energy prices rule the roost, as they have for the last few days," said Ned Riley, of Riley Asset Management.

"People are coming to the conclusion that energy prices are not the be-all, end-all of this economy, nor is the reconstruction of the Gulf Coast [in the wake of recent hurricanes]," he added.

"The market this week has been locked in a trading range, hovering near the low end of the range," said Steve Goldman, chief market strategist at Weeden & Co.

"We have seen some mild reversals from market lows, but this afternoon's reversal has a bit more substance behind it. But there hasn't been a lot of substance behind most of the gains or most of the selloffs this week," he added.

Marc Pado, U.S. market strategist at Cantor Fitzgerald, predicted trade will become more lively next week, when the fourth quarter gets under way.

The November futures contract for crude closed up 44 cents at $66.79 a barrel, after earlier trading as high as $67.20.

November natural-gas futures finished up 9.6 cents at $14.196 per million British thermal units, after earlier hitting a record high of $14.58 during the premarket session.

Earlier, the Energy Department reported that natural-gas stocks rose by 53 billion cubic feet during the week ended Sept. 23. Analysts at Platts expected a rise of 67 billion, but First Enercast Financial predicted an increase of 49 billion.

The Commerce Department reported that the final reading for second-quarter gross domestic product was 3.3%, unchanged from the prior reading and down from 3.8% in the first quarter. See full story.

The reading was in line with the forecasts of Wall Street economists in a survey conducted by MarketWatch. See Economic Calendar.

Initial jobless claims in the latest week fell by 79,000 to 356,000; 60,000 of those claims were related to Hurricane Katrina, a Labor Department spokesman said. Economists are divided as to how long it will take for all displaced hurricane victims to file claims.

The Treasury market lost strength after the larger than expected drop in hurricane-impacted jobless benefits provided new credence for the view that the Fed is likely to keep lifting rates. The benchmark 10-year Treasury note closed down 7/32 at 99-22/32 with a yield
TNX, -0.11%
of 4.29% versus 4.26% Wednesday. See full story.

The dollar was mixed, after earlier in the week reaching two-month highs due to strong hints from Fed officials that the central bank plans to keep lifting rates. See full story.

The U.S. currency fell 0.04% to 112.96 yen as the euro fell 0.02% to $1.2041.

The December gold-futures contract closed up $2.70 at $475.80. The gains followed a rally of nearly $7 on Wednesday. See full story.

Stocks in action

Dow component General Electric Co
GE, -1.68%
closed up 16 cents at $33.65. The health-care unit will buy IDX Systems Corp. in a deal to create a $1.2 billion health-care technology vendor, the companies said Thursday. See full story.

E-Trade Financial Corp.
ET, -2.39%
shot up 5.4% to $17.22, after announcing it will buy Brown Co. from J.P. Morgan Chase for $1.6 billion in cash. See full story.

PepsiCo
PEP, -1.15%
advanced 2.6% to close at $56.50. The soft-drink and snack giant beat its revenue and profit targets for the third quarter. See full story.

Shares of Guidant Corp.
GDT
fell almost 3% to $68.17. The New York Times reported that criminal investigators at the Food and Drug Administration are looking into the way Guidant handled problems with heart devices.

The report quoted a federal prosecutor saying that it was not unusual for the agency's criminal investigators to get involved if there were indications that a company might not have complied with the agency's reporting requirements.

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